Austerity plan at San Diego Hospice brings layoffs

More than 180 San Diego Hospice employees received layoff notices Wednesday and Thursday, as the organization implements an austerity plan designed to keep it operating in the face of ongoing Medicare audits.

Chief Executive
Kathleen Pacurar
said Thursday that the cuts include temporarily shutting down San Diego Hospice’s most visible presence in the community, a 24-bed specialty hospital in Hillcrest.

The move is the result of Medicare temporarily shutting off reimbursement payments in early November, causing the hospice, one of the largest in the nation, to
temporarily stop admitting patients
.

Those Medicare payments have since resumed, removing doubts about the organization’s survival. But heightened federal scrutiny of its patient admittance practices continues, forcing the hospice to downsize.

Pacurar said that 95 percent of hospice services are delivered to patients in their homes, and that work will continue unabated.

“We’re able to make these changes and the patient, in their bed in their home, isn’t going to feel any of them,” Pacurar said.

A 12-bed inpatient center in Carlsbad, which the hospice leased from a private company, has been permanently closed.

About 180 employees associated with in-home services have already been laid off, Pacurar said, but hospital staff, who number about 80, were given a 30-day layoff notice this week. Patients who are still at the hospital on Dec. 31 will be moved to other hospitals or skilled nursing facilities.

Medicare is currently auditing every payment it makes to San Diego Hospice, and the organization fears it may have to return millions in reimbursements to the federal government because many of the patients it served in the past did not meet guidelines for reimbursement.

Those guidelines require a hospice to serve only patients who have six months or less to live. Hospice operators are required to document each patient’s declining condition and to discharge those who don’t meet the guidelines.

But that did not always happen at San Diego Hospice. In some cases, patients remained in hospice care for a year or more without proper documentation.

“We lost sight of interpreting these guidelines appropriately. We put the concept of patients, and what we were going to be able to do for them, above what the guidelines were,” Pacurar said previously.

Hospice has become a
$13 billion business
nationwide, and other large Hospice operators are coming under similar scrutiny.

After conducting its own internal audit, San Diego Hospice began discharging patients that it could not prove met the Medicare guidelines and also became more strict about the patients it admitted. Those actions pushed the hospice’s total number of patients from more than 1,000 to about 700, Pacurar said.

She said that, overall, the organization’s annual budget is expected to drop from $83 million to $63 million. Employment will go from 870 to about 600.

She said the cuts came across the board and included management as well as front-line workers.

“It was organization wide,” she said. “There wasn’t a department that wasn’t impacted.”

The cuts, Pacurar said, were particularly painful because employees were delivering high-quality care to their patients.